(Economic Watch) House price growth in 70 cities in 2021 will be less than 2% or three major trends this year

　　China News Agency, Beijing, January 15th: In 2021, housing prices in 70 cities will increase by less than 2%, and there may be three major trends this year.

　　China News Agency reporter Pang Wuji

　　In 2021, housing prices in China's large and medium-sized cities will "rise first and then fall". Although there are large short-term fluctuations, the overall trend is stable.

　　According to data released by the National Bureau of Statistics on the 15th, in December 2021, the year-on-year increase in housing prices in 70 large and medium-sized cities in China dropped.

According to the calculation of the Shell Research Institute, the average year-on-year growth of second-hand housing prices in 70 cities is less than 1%, and the average year-on-year growth of new housing prices has narrowed to less than 2%.

This means that after a year, housing prices in many places have basically returned to the starting point in early 2021.

How are house prices trending this year?

Many industry insiders have analyzed that there may be three major trends.

Data map: Real estate real estate.

Photo by China News Agency reporter Zhang Bin

The Yangtze River Delta property market may be the first to pick up

　　Judging from the housing price index of 70 cities in December, Hangzhou in the Yangtze River Delta region has the highest increase in new house prices (up 0.5%), Shanghai ranks second (up 0.4%), and Wenzhou and Hefei are also relatively high in new house price growth.

The same goes for the second-hand housing market.

Shanghai (up 0.4%) and Hangzhou (up 0.3%) were among the 70 large and medium-sized cities in December, the few cities where second-hand housing prices maintained their upward trend, ranking third and fourth in terms of increase.

　　Li Yujia, chief researcher of the Guangdong Housing Policy Research Center, pointed out that this means that the property market in the Yangtze River Delta may be the first to pick up.

He analyzed that the increase in the price of new houses in Hangzhou was the main reason for the third round of centralized land supply last year. The local government made obvious profits, the land premium rate fell, and the supply of central plots increased, which boosted market sentiment.

　　At the same time, he pointed out that the prices of new houses in Guangzhou and Shenzhen continued to fall in December by 0.6% and 0.1% respectively, and the prices of second-hand houses also declined to varying degrees.

Last year, the Pearl River Delta had the highest popularity of new houses in the country, but at the end of the year, the housing prices in these two central cities of the Pearl River Delta were still in the falling range, which means that the property market in the Pearl River Delta may continue to show a weak trend.

Second-hand housing prices in first-tier cities stop falling and rise

　　With the property market running at a low level in recent months, first-tier cities are relatively strong.

Official data show that in December last year, the sales price of second-hand housing in first-tier cities turned from a month-on-month decrease of 0.2% to an increase of 0.1%.

Among them, Beijing and Shanghai rose by 0.8% and 0.4% respectively.

　　Zhang Bo, Dean of the 58 Anju Room Real Estate Research Institute, believes that in general, the price of new houses in first-tier cities is affected, and the market cooling in many hotspots is not obvious, but the proportion of hot sales has shown a downward trend.

The turnaround in the price of second-hand housing is one of the main signals that the market has bottomed out and rebounded, especially in Beijing and Shanghai.

　　Li Yujia also believes that first-tier cities are dominated by second-hand housing. According to past practices, the second-hand housing market is ahead of the new housing market, and the cessation of second-hand housing is a sign of the market bottoming out.

It is expected that in the first quarter of this year, the property market in first-tier cities will be the first to bottom out.

　　Second-hand home sales also recovered in the last few months of last year.

Data from the Shell Research Institute shows that since October 2021, the transaction volume of second-hand housing in key 50 cities has rebounded for three consecutive months, and the second-hand housing climate index, which represents market expectations, also stopped declining in December.

The resilience of the property market shows that housing prices may gradually stabilize

　　Xu Xiaole, chief market analyst of the Shell Research Institute, pointed out that in December, the average month-on-month decline in new and second-hand housing prices in 70 cities narrowed slightly, which was the first time since this round of market downturn.

Except for the second-hand housing prices in first-tier cities, which stopped falling and stabilized month-on-month, the second-hand housing prices in key provincial capital cities and some third-tier cities also saw a decrease in the month-on-month decline.

These markets were able to pare losses after several months of decline, a sign of the resilience of demand in China's real estate market.

　　Zhang Bo pointed out that the polarization of the property market continues.

In December, among the second-tier cities, the price of new houses in popular second-tier cities such as Nanjing, Hangzhou, Hefei, and Xiamen rose month-on-month, while Taiyuan, Harbin, Zhengzhou, Xining and other cities were still in the cooling channel.

In addition, the cooling of the real estate market in third-tier cities is also continuing.

　　Many experts believe that the current upward momentum in the property market is insufficient, and the "weak market" will continue into the first quarter of 2022.

Under the positioning of "housing to live without speculation", it is rare to see a substantial loosening of control policies.

(Finish)